V3 ENGINEERS PVT LTD,BANGALORE vs. INCOME TAX OFFICER WARD-7(1)(3), BANGALORE

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ITA 2360/BANG/2018Status: DisposedITAT Bangalore13 March 2019AY 2013-141 pages
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What did the Tribunal hold?

The Tribunal set aside the impugned notices under Section 200A for computation and intimation of fees under Section 234E for periods prior to June 1, 2015. The judgment was held to have prospective effect, and the question of constitutional validity of Section 234E was left open for a Division Bench.

What were the facts?

The ITAT was considering the constitutional validity of Section 234E and the validity of notices issued under Section 200A for computation of fees under Section 234E. The appellant stated they would not press the challenge to Section 234E if notices under Section 200A were set aside, but requested the constitutional validity question be kept open.

What were the issues?

The primary issue was the constitutional validity of Section 234E and its application through notices under Section 200A. The Tribunal also considered the prospective application of its decision.

Which sections of the Income-tax Act were involved?

Section 234E,Section 200A

AI-generated summary — verify with the full judgment below

to 2362/Bang/2018 Page 10 of 12 for testing the constitutional validity of Section 234E would be rendered as an academic exercise because there would not be any cause on the part of the petitioners to continue to maintain the challenge to constitutional validity under Section 234E of the Act. At this stage, ve may also record that the learned counsels appearing for the appellant had also declared that if the impugned notices under Section 200A are set aside, so far as it relates to computation and intimation for payment of fee under Section 234E, the appellant-petitioners would not press the challenge to the constitutional validity of Section 234E of the Act. But, they submitted that the question of constitutional validity of Section 234E rr.ay be kept open to be considered by the Division Bench and the Judgment of the learned Single Judge may not conclude the constitutional validity of Section 234E of the Act.

26.

Under these circumstances; we find that no further discussion would be required for examining the constitutional validity of Section 234E of the Act. Save and except to observe that the question of constitutional validity of Section 234E of the Act before the Division Bench of this Court shall remain open and shall not be treated, as concluded.

27.

In view of the aforesaid observations and discussion, the impugned notices under Section 200A of the Act for computation and intimation for payment of fee under Section 234E as they relate to for the period of the tax deducted prior to 1.6.2015 are set aside. It is clarified that the present judgment would not be interpreted to mean that even if the payment of the fees under Section 234E already made as per demand/intimation under Section 200A of the Act for the TDS for the period prior to 01.04.2015 is permitted to be reopened for claiming refund. The ice-77nent will have prospective effect accordingly. It is further observed that the question of constitutional validity of Section 234E shall remain open to be considered by the Division Bench and snail not get concluded by the order of the learned Single Judge.”

5.3.3 Considering the above decision of the Hon’ble High Court of judicature in the case of Fatheraj Singhvi and Others Vs. Union of India (supra), it prima facie appears that the assessee has a favourable case on merits. When there is a decision of the jurisdictional High Court, judicial discipline and propriety requires that we are duty bound to follow the same

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